Tami Howie: Protecting Innovation Protects Patients and Our Economy

Innovation is at the heart of Maryland’s economy and the wellbeing of patients in our state. New, groundbreaking cures and treatments save and extend the lives of patients, pushing the bounds of modern medicine, for the benefit of all. Innovative companies are able to leverage Maryland’s combination of technology know-how, business-friendly climate, and highly-educated, highly-skilled workforce to produce these cures and provide hundreds of thousands of Marylanders with well-paying jobs.

However, despite all this, the Maryland General Assembly is currently debating drug pricing legislation that would threaten the innovative potential that makes these benefits possible. New regulations, SB 1023/HB 1194, would create a government-controlled commission with broad leeway to influence drug prices and increase burdensome reporting requirements adding yet another layer of complexity to drug manufacturing.

In so doing, it creates new hoops to jump through for manufacturers to simply go about their business. It risks innovation by undercutting the incentive for the creation of new drugs, that, on average, take 10 years and cost $2.6 billion to produce.

Maryland’s innovation and the companies who contribute to it should be hailed as a success story. Maryland is home to more than 2,500 life sciences companies that contribute nearly $18 billion toward our state’s GDP. Our state has more than 70 federal labs and is the headquarters of the Centers for Disease Control and Prevention. The biotechnology industry alone employs 34,000 Marylanders. As a result, Maryland is among the country’s leaders in state-wide innovation and entrepreneurship according to the U.S. Chamber of Commerce. Undercutting innovation threatens not only this status, but all of the organizations who benefit from it, and all of the well-paying jobs that they produce.

And in the end, the patients who rely on these innovative medicines – and future cures to come – are the ones who are punished. These patients will see their prices increase as fewer and fewer cures are produced with lessening competition among our state’s best and brightest. In the worst cases, they could see a loss of access to certain drugs all-together, forcing them to cross state lines simply to get the medications they need to get through the day.

Maryland’s General Assembly should reject this legislation, as it will do the exact opposite of what it intends: drive drug prices higher, not lower, all while hurting the innovative spirit that produces critical cures for patients.

The increasing cost of health care is a pressing concern for all Marylanders, and one all health care stakeholders need to address. The Maryland Tech Council supports policies to address these rising costs in ways that are patient-centric and promote access; the problem with SB 1023/HB 1194 is that it does neither.

Rather than attempting a comprehensive approach, working with various stakeholders to determine the true roots of ballooning health care costs, this bill myopically and inaccurately targets drug producers alone. It fails to account for the outsize role that insurers, pharmacy benefit managers (PBMs) and other middlemen play in setting drug prices. It fails to account for the true dynamics of a complicated, interconnected health care system, with a wide array of stakeholders possessing competing interests.

If elected officials want to honestly and sincerely grapple with health care costs, they should examine approaches that are holistic, ensure access to Maryland patients and protect the innovation economy that helps them live longer, healthier and happier lives. Doing so requires that they reject misguided regulations like SB 1023/HB 1194.

Tami Howie is the Chief Executive Officer of the Maryland Tech Council, a community of more than 600 industry-leading technology firms and organizations